FAQs About the Buyer’s Right of Rescission in B.C. Real Estate
As of 2023, homebuyers in British Columbia have a unique protection known as the Home Buyer Rescission Period (“HBRP”) or Right of Rescission. This legal right gives buyers a limited window to cancel a residential real estate contract - no conditions needed.
Below we cover frequently asked questions about a buyer's right of rescission.
What is the Right of Rescission?
The Right of Rescission allows a homebuyer to unilaterally cancel a signed contract of purchase and sale for residential property — no justification required — within 3 business days after acceptance of the offer.
This right exists under Section 42 of the B.C. Property Law Act and cannot be waived by the buyer or excluded by the seller.
How long do buyers have to change their mind?
Buyers have three business days after the date the offer was accepted to rescind the contract. “Business days” exclude Saturdays, Sundays, and statutory holidays in B.C.
Example:
If an offer is accepted on a Monday, the buyer has until 11:59:59 PM on Thursday to cancel (assuming Monday is not a statutory holiday).
How does a buyer rescind the contract?
The buyer must serve written notice to the seller within the 3-day period. This notice must be delivered in a manner prescribed by regulations and as outlined in the contract of purchase and sale (such as in person, by email, or another agreed-upon method).
Is there a penalty for rescinding?
Yes. If a buyer cancels under the Right of Rescission, they must pay the seller a rescission fee equal to 0.25% of the purchase price.
Example:
For a $900,000 home, the buyer would owe the seller a rescission fee of $2,250.
If a deposit was paid, the rescission fee is deducted from it, and the balance is refunded to the buyer. If no deposit or a smaller deposit was paid, the buyer must promptly pay the difference.
What if an offer has subject conditions, and the buyer doesn't proceed based on those subjects during the rescission period?
If a buyer includes subject conditions (such as financing approval, home inspection, or review of strata documents) in their offer and decides not to proceed with the purchase based on these conditions, they can withdraw from the contract without paying the 0.25% rescission fee—even if this decision occurs within the three-business-day rescission period.
The rescission fee only applies when a buyer formally exercises their right of rescission by providing written notice to cancel the contract under the HBRP. If the buyer withdraws due to unmet subject conditions, it's considered a standard contractual termination, not a rescission under the HBRP, and no fee is owed.
It's important to note that the rescission period and the subject removal period can overlap. Buyers should be aware of both timelines and consult with their real estate professional to understand their rights and obligations fully.
Are any property types exempt from the Right of Rescission?
Yes. The following types of residential real estate transactions are exempt:
- Properties on leased land
- Leasehold interests
- Properties sold at auction
- Sales made under a court order or court supervision
- Certain sales under the Real Estate Development Marketing Act (REDMA), such as new developments covered by Section 21 (learn more about the right to rescission under REDMA here>>)
What if the title has already transferred to the buyer?
Once the title of the property has transferred, the Right of Rescission no longer applies — even if it’s still within the 3-day window.
Can the buyer waive this right?
No. The Right of Rescission is non-waivable. It applies to all eligible residential transactions regardless of what the contract says.
What should sellers know?
Sellers must understand that even a firm, accepted offer isn’t final until the 3-business-day rescission period has passed. This period can delay certainty, especially in competitive markets.
How will I know about the Right of Rescission in my contract?
Whether you're a buyer or a seller, the Right of Rescission must be clearly disclosed to you during the transaction. This is a legal requirement, and your real estate agent is responsible for making sure it happens.
There are two ways you might receive this information:
- In the Contract of Purchase and Sale:
The details of the rescission right — including the acceptance date, the deadline to cancel, the purchase price, and the 0.25% rescission fee — may be included right in the contract you sign. - In a separate disclosure form:
If the contract doesn't include this information, your agent will give you a separate document called the “Disclosure of Buyer’s Right of Rescission.” This form outlines the cancellation rights in plain language.
Important for buyers: You must receive this disclosure either when making an offer or when negotiating price changes.
Important for sellers: You’ll receive this form when an offer is presented to you, so you're fully aware the buyer has a short window to cancel — even if the offer appears firm.
Final Thoughts
The Right of Rescission is a significant consumer protection measure in B.C.’s real estate market. Buyers get a chance to reconsider without needing a legal excuse, while sellers must plan for a short window of uncertainty.
Have questions about your specific transaction? Always consult your real estate licensee or legal professional. Have general questions? We'd love to chat. Reach out via the form below.